Macy’s has cut its profit outlook for 2015 after a drop in sales in Q3.
The department store’s net income for Q3 of 2015 was $118 million, down from $217 million in the same period last year.
Macy’s shares fell 14% following the news.
In a statement, Macy’s CEO Terry Lundgren said the company was “disappointed” that the pace of sales did not improve as much as expected.
Sales were hurt in part by the warm weather, which made it harder to sell winter clothing, and a strong dollar, which hurt tourist spending.
“Heading into the fourth quarter, we are shifting our organization into overdrive to focus on sales-driving activities in the holiday shopping season,” said Terry Lundgren.
Macy’s now sees full-year earnings coming in at $4.20 to $4.30 per share, compared with an earlier guidance of $4.70 to $4.80.
The company has opened five discounted outlets in the New York area and plans to open a sixth by the end of 2015.
Macy’s, which also owns the department store Bloomingdale’s, plans to open three new discount branches of that store too.
The company said it is also considering discounts at its stores to help move large quantities of inventory.
On a call with investors CFO Karen Hoguet said “we will need to liquidate this inventory in the fourth quarter so that we can maintain the flow of fresh new merchandise.”
Macy’s has been cutting down on the number of standard priced stores that it owns for the last several years. Earlier this year it announced plans to close 35 to 40 stores in the US in early 2016.
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